Bucheon, Gyeonggi Province, South Korea – The Fair Trade Commission (FTC) has issued a consumer advisory regarding a growing number of cases where consumers are lured into Sangjo (Korean funeral service plan) contracts with the promise of free or discounted electronic appliances, only to be hit with hefty cancellation fees upon terminating the service.

The FTC and the Korea Consumer Agency (KCA) have reported a surge in complaints related to these bundled Sangjo(Korean funeral service plan) service and appliance deals. Often, Sangjo companies and appliance/rental businesses fail to provide sufficient information about the contract terms, leading to consumer detriment.

Over the past three years (2022-2024), the 1372 Consumer Counseling Center received a total of 8,987 consultation requests related to Sangjo (Korean funeral service plan). Out of these, 477 cases were filed with the KCA for dispute resolution, indicating a persistent trend of consumer harm.

The most frequent cause of consumer complaints was contract cancellation, accounting for 64.4% of the cases. This was followed by non-performance or incomplete performance of the contract at 21.6%.

A common tactic involves offering high-value electronic appliances as "gifts" upon signing up for a Sangjo service or advertising the plans as "savings-type" products with a full refund upon maturity. Consumers, trusting the company's representations, often discover significant penalties when they attempt to cancel their Sangjo (Korean funeral service plan) contracts.

The FTC strongly advises consumers to exercise caution and not be swayed by offers of free gifts or the notion of a savings plan when considering Sangjo service enrollment. It is crucial to verify whether there is a separate contract in addition to the Sangjo (Korean funeral service plan) agreement. Consumers should also meticulously review key contract details such as the total contract amount, payment duration, and, most importantly, the refund policy upon cancellation, including the refund rate and payment timeline.

For any inquiries or to report issues related to Sangjo (Korean funeral service plan), consumers can contact the 1372 Consumer Counseling Center or visit the online platform Consumer 24.

An FTC official stated, "We are working closely with the Korea Consumer Agency to understand the current situation regarding Sangjo bundled products and are committed to actively protecting consumers in the prepaid installment transaction sector."

This advisory serves as a critical reminder for consumers to be vigilant and thoroughly understand the terms and conditions before committing to Sangjo service contracts, especially those involving bundled offers.

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